Senate agrees new credit to counter recession

Keystone

Parliament has endorsed another series of measures to stimulate the Swiss economy, hit by the global financial crisis.

The SFr710 million ($615 million) package is destined for infrastructure projects in the transport sector as well as energy, environment research and tourism.

Two days after animated late-night discussions in the House of Representatives, the bill won unanimous approval by the Senate.

“We consider the packet drafted by the government as reasonable, pragmatic and well balanced,” said Philipp Stähelin on behalf of the Senate’s finance committee on Wednesday.

During the four-hour debate several speakers highlighted the needs of the export industry.

Didier Burkhalter of the centre-right Radical Party called for additional steps, including a cheap Swiss franc to boost the country’s economic sector.

Representatives of centre-right parties warned of running up huge debts by agreeing to a public-spending spree without examining the efficiency of stimulus programmes.

However, unlike in the debate in the House on Monday, no parliamentarians called for an outright rejection of the SFr710 million credit.

Not enough

Senators of the rightwing Swiss People’s Party, as well as the centre-left Social Democrats and Greens, criticised the fact that the funds were not generous enough to have a sustainable impact.

“It is not realistic to hope for a noticeable effect,” said Luc Recordon of the Green Party. He said it was all the more important to consider far-reaching structural measures.

The package was hardly more than a symbolic gesture and had a psychological effect at best, according to the People’s Party’s This Jenny. “This is not nearly enough to lift our economy out of the recession,” he said.

In a similar vein Social Democrat Anita Fetz described the package as a step in the right direction but believed more was needed at a later stage.

She called for stricter controls of the financial institutions which triggered the economy crisis and more international cooperation to crack down on tax dodgers.

Third package

Finance Minister Hans-Rudolf Merz said quality was key and that the aim of any further government intervention was to prevent a dramatic rise in unemployment.

The jobless rate in Switzerland is 3.4 per cent, but economic experts forecast an increase of up to 4.5 per cent by the end of the year.

Merz said he was sceptical about a third public-spending programme.

Economics Minister Doris Leuthard announced that the government would decide such a move in June. She cautioned that any extra spending had to be weighed against the consequences of running up debts.

She said the various economic factors, including foreseeable price increases and higher duties from next year, had to be considered.

UBS

Wednesday’s discussions wrapped up the extraordinary sessions of both parliamentary chambers during the spring session.

However, the Senate did not discuss a controversial proposal to reorganise UBS, the country’s leading bank, and consider capping the salaries of its top managers.

An alliance of rightwing and centre-left parliamentarians won a majority for such moves in the House of Representatives on Monday.

The government supported UBS with a multi-billion franc bailout package in October to strengthen the bank’s capital base. Earlier this year it handed over confidential bank client details to the United States to avoid sanctions by the justice authorities.

swissinfo, Urs Geiser

In brief

The second stimulus package worth SFr710 million mainly targets infrastructure projects for road and rail.

It also includes credits for research, energy, environment and tourism.

It was approved by the cabinet last month.

A first package to the tune of SFr980 million to boost private investment and prevent job cuts was agreed last year.

The government is due to decide in June on a third programme if the economic downturn continues.

swissinfo.ch